Various sales promotion techniques or tools exist, such as prizes, contests, sweepstakes, games, free samples, product warranties, tie-in promotions, loyalty points, cross-sell, up-sell, premium memberships, card discounts, and gift certificates. These have been used for a long time to retain loyal customers, to increase the repurchase rate of occasional buyers, to attract new buyers, to manage inventory, and to gain market share. In more recent times, such techniques have been embodied in electronic form. All such techniques and tools, and others such as instant discount (which is similar to haggling or negotiations as occurs in conventional commerce), are herein referred to as “coupons”.
There are different classes of coupons based upon the identity issuing authority (i.e. manufacturer or retailer), whether the coupon is targeted to a set of potential customers or untargeted, and whether the number of coupons to be distributed is limited or unlimited. The various classes of coupons serve different purposes. For example, coupons issued by a manufacturer to a group of loyal customers in limited numbers could be intended to retain those loyal customers. Coupons issued by a manufacturer in untargeted mass distribution could be intended to attract buyers for a new product, and coupons issued by a retailer in untargeted limited distribution could be intended to attract customers to a retail outlet.
Normally, when a manufacturer or a retailer issues coupons on a product or a service, a coupon is expected to be used only for that product or service. To save coupon creation and management costs, or to attract new buyers, a manufacturer or retailer may decide to honor the coupons issued by another party. This is referred to as cross-coupon honoring.
In a generic form, electronic coupon systems must allow a buyer to collect electronic coupons while doing on-line shopping (or otherwise visiting an e-commerce site) from various e-commerce sites, and to redeem these coupons on-line at any e-commerce site or physical store, satisfying the purchase conditions of the offer.
Consider the case where ‘A’ and ‘B’ are two competing airlines, and Airline ‘A’ issues electronic discount coupons to its frequent flying customers. The Airline ‘B’, as a counter-strategy, announces that Airline “B” will also honor the coupons issued by the Airline ‘A’ (i.e. it will give discounts to the customers carrying the Airline ‘A’ coupon for buying Airline ‘B’ tickets). In the process, Airline ‘B’ stands to gain more than the Airline ‘A’, as it saves the coupon creation and management costs and is also able to target the competitor's loyal customers. Clearly, Airline ‘A’ would find cross-coupon honoring of its coupons undesirable and disadvantageous. Thus there is a need for cross-coupon honoring prevention solutions.
From a different perspective, cross-coupon honoring is also disadvantageous to Airline “B”. In particular, the redeeming e-commerce site (eg. Airline ‘B’) still has to verify that the electronic coupon is valid (i.e. it was indeed issued by the competitor), the terms and conditions have not been altered in some way, and the coupon has not already been redeemed.
Thus, a need clearly exists for an improved system of honoring coupons overcoming or at least ameliorating one or more disadvantages of conventional approaches described hereinbefore.